taxes

When a student is a dependent

George Saenzq_v2.gifDear Tax Talk,
If you have a child who is 22 years old and is only a part-time student, but you still pay for more than half of his or her support, can you claim the child as a dependent? Or do students absolutely have to be full time?
-- Clay

a_v2.gifDear Clay,
You can claim a dependent that is either your qualifying child or qualifying relative. To be a qualifying child, the dependent has to meet the relationship, age, residency and support tests.

Under the relationship test, a child must be your son, daughter, stepchild, foster child, or a descendant (for example, your grandchild) of any of them, or your brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant (for example, your niece or nephew) of any of them.

Under the age test, a child must be under age 19 at the end of the year, a full-time student under age 24 at the end of the year, or permanently and totally disabled at any time during the year, regardless of age.

A full-time student is a student who is enrolled for the number of hours or courses the school considers to be full-time attendance (usually 12 semester hours). To qualify as a student, your child must, during some part of each of any five calendar months of the year, attend a school with a regular teaching staff, course of study and student body.

Because your child does not meet the age test, you can only claim him as a dependent if he can be considered your qualifying relative. The primary difference in the categories of dependents is the gross income of the dependent.

A child can be your qualifying child regardless of his or her income if he or she meets all the other tests. If the child fails any of the tests, he or she can still be your dependent as a qualifying relative. Under the qualifying relative category there is no age test, but instead an income test.

Under the gross income test, the child may not have income that exceeds the amount of the dependency exemption for the year. In 2008, that limit is $3,500. Hence, the child does not absolutely have to be a full-time student if his gross income is under $3,500.

To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Taxpayers should seek professional advice based on their particular circumstances.

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